Question: Our company would like to establish of pure local company and assign 100% shares from such pure local company to our company. Please quote.

Answer:

We understand that you would like us to advise on (i) establishment of pure local company and

(ii) Assigning 100% shares from such pure local company to Client. We are therefore grateful to present you hereinafter our Legal Services Proposal for your review and consideration.

1.  ISSUES & COMMENTS

From our initial discussion, we acknowledge that Client is a wholly foreign invested company duly established and operating under Vietnam Law. Client now considers purchasing a land lot from Vietnamese Individuals for the purpose of building up Serviced Apartments for lease. Meanwhile, according to Vietnam Land Law and Vietnam Real Estate Business Law, foreign invested company is only allowed to lease land from competent authority or several specific Land Users for developing investment projects in Vietnam. Duration of land use right shall be limited to 50 years.

In light of the above, in order to optimize his benefit in Vietnam, Client considers adopting following option:

Step 1: Current Land Users of the above Land Lot shall setup a pure local company operating in the field of providing serviced apartments.

Step 2: Current Land Users shall contribute Land Use Right of the above Land Lot to the newly established local company.

Step 3: Pure Local Company shall obtain necessary licenses for building up serviced apartments for lease in the Land Lot.

Step 4: Client shall acquire 100% shares from such pure local company and continue with building up serviced apartment.

2.    SCOPE OF SERVICES

SCOPE OF SERVICES
(i)  Prepration agreements between Client and current Owner of the Land lot

–  Preparing Memorandum Of  Understanding between Current Owners of the Land lot and Client to reflect overall transaction in English and Vietnamese.

–  Preparing Triparty Agreement between Client, Current Owners of the Land Lot and Bank for opening and operating Blocked Bank Account for securing payment obligation;

–   Preparing Share Assignment Contract between Client and Current Owner of the Land Lot.

(ii)  Establishing the local nominee company

· Providing advices on all legal aspects relating to procedures of obtaining Enterprise Registration Certificate for Client from competent authority;

· Preparing Application Dossiers (in both Vietnamese and English) for obtaining Enterprise Registration Certificate for Client;

· Representing Client to submit the Application Dossiers for obtaining Enterprise Registration Certificate for Client;

· Working with provincial competence authority on behalf of Client to obtain the best support on reviewing and considering the application and providing explanation and/or supplementation of application dossiers per request;

·  Updating information of the approving process to Client;

·  Receiving Enterprise Registration Certificate from provincial competent authority and hand it over to Client.

(iii)       Assisting on obtaining approval for contribution of land use right to the pure local company

·  Providing advices on all legal aspects relating to procedures of obtaining approval for contribution of land use right to the pure local company;

·  Preparing Application Dossiers for recording land use right’s contribution to the pure local company;

·  Representing Client to submit the Application Dossiers for amendment of Certificate of Land Use Right recording the Pure Local Company as new Land Users;

· Working with District People Committee on behalf of Client to obtain the best support on reviewing and considering the application and providing explanation and/or supplementation of application dossiers per request;

·  Updating information of the approving process to Client;

·   Receiving updated Certificate of Land Use Right from provincial competent authority and hand it over to Client.

 

(iv)   Assisting on obtaining necessary approval for building up serviced apartments

·   Providing advices on all legal aspects relating to procedures of obtaining approvals for building up serviced apartments on the Land Lot;

·    Preparing Application Dossiers for applying necessary approval;

·    Working with District People Committee on behalf of Client to obtain the best support on reviewing and considering the application and providing explanation and/or supplementation of application dossiers per request;

·  Updating information of the approving process to Client;

·   Receiving the final result on behalf of Client.

(v)   Assisting on obtaining necessary approval for registration of shares acquisition and amending Certificate of Enterprise Registration to reflect change of ownership from Vietnamese Owner to Client

·  Providing advices on all legal aspects relating to procedures of obtaining approval for Share’s Acquisition and updating Certificate of Enterprise Registration;

· Preparing Application Dossiers (in both Vietnamese and English) for obtaining Approval for Share’s Acquisition and updating Certificate of Enterprise Registration;

·  Representing Client to submit the Application Dossiers for obtaining Share’s Acquisition and updating Certificate of Enterprise Registration;

·  Working with provincial competence authority on behalf of Client to obtain the best support on reviewing and considering the application and providing explanation and/or supplementation of application dossiers per request;

·  Updating information of the approving process to Client;

·  Receiving Final Approval and Updated Enterprise Registration Certificate from provincial competent authority and hand it over to Client.

  1. PROFESSIONAL FEE

Our professional fee shall be as follows:

▶ For preparation MOU between Client and Current Owner of the Land Lot, our professional fee shall be VND 28,360,000 (Twenty eight million three hundred and sixty thousand Vietnam Dong);

▶            For preparation Triparty Contract for opening Blocked Bank Account between Client,

Bank and Current Owner of the Land Lot, our professional fee shall be VND 12,706,000 (Twelve million seven hundred and six thousand Vietnam Dong);

▶            For preparation Share Transfer Agreement between Client and Current Owner of the

Land Lot, our professional fee shall be VND 29,732,000 (Twenty nine million seven hundred and thirty two thousand Vietnam Dong);

▶            For setting up a Pure Local Company, our professional fee shall VND 6,000,000 (Six million Vietnam Dong);

▶            For obtaining approval for contribution of land use right to the pure local company: To be confirmed in a separate legal service proposal

▶            For obtaining necessary approval for building up serviced apartments: To be confirmed in a separate legal service proposal

▶            For obtaining necessary approval for registration of shares acquisition and amending

Certificate of Enterprise Registration to reflect change of ownership from Vietnamese Owner to Client, our professional fee shall be VND 87,075,000 (Eighty seven million and seventy five thousand Vietnam Dong).

▶            For attending meetings between Client and Current Owner of the Land Lot shall be charged on our hourly rate, i.e. VND 4,126,000 (Four million one hundred and twenty six thousand Vietnam Dong)/01 working hour.

▶            Please noted that our Professional Fee is exclusive of 10% VAT and any disbursements including, governmental fee, consularization, legalization fees; expense for translating

your documents from English into Vietnamese (as 226,900 VND per 150 words); Actual communication fee and travelling costs required in performing the legal services. Client is, therefore, required to reimburse these expenses

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